Apple injunction defeats, and now under anti-trust cloud

The technology in question was describe with enough details in a book that the court ruled anyone could have implemented the idea from the book's description. Basically the idea was out there enough that a writer and not someone skilled in the art could come up with it. If that's not the definition of obvious then nothing is

That is, in fact, a "textbook" definition.

The basic phrase is that the inventor is assumed to have 'extraordinary skill' in the relevant art.

But, 'prior art' is something that someone with 'ordinary skill' in the relevant art can be expected to be able to do.

If some author, not even of 'ordinary skill' in the art shows a workable design of the item in question, it would be prior art pretty much by definition. They key is that you'd have to be convinced (as the judge was) that the description was enough for someone with ordinary skill to reduce it to practice. Thus, even if the author of the book actually lacked the skill to build it, that wouldn't matter as long as the 'ordinary skill' person could.

For some things (especially mechanical ones) sales brochures can sometimes be prior art, because some things are obvious on their face once you see it. For instance, there's a famous patent where someone put a well-designed bend in the handle for a snow shovel that reduced backache. Just a picture of the invention is enough to communicate its essence, so a brochure, even had it never patented, would make that particular idea prior art for someone else trying to do the same thing.

Look, can you point to any other company [other than Apple] currently embroiled in patent litigation that is having their [already] granted patents brought up for "reexamination" over "obviousness"? What about Microsoft? It seems to be a frequent and recurring tactic as of late, no?

Now, you keep posting: "It is specifically set up to deal with hindsight bias.", but from what I've been reading, hindsight bias is a pretty big "problem", and there are numerous cases that have been completely overturned due to hindsight bias.

As in Apple's case, their patents seem to be getting (re)examined to the point of ridiculousness. It's reductionism, and should be avoided. I already mentioned one fairly remarkable case that involved the Robert Kearns patent. The auto industry tried like hell to point to all sorts of "prior art"; even pointing out that the combination of parts used to construct his patent we're "obvious" - right up to the point it *wasn't* obvious. It was just that the auto makers were being influenced by hindsight bias. People forget that patent's can be improvements upon older technology, or even new uses for existing technologies. Anyway, the other patent case that was overturned was the Pumpkin leaf bag. patent. Are you familiar with the outcome of that particular case?

The short is that there was this woman Anita Dembiczak, who came up with the idea of decorating a trash bag to look like a pumpkin. It was then meant to be stuffed with leaves. Oh the cries of "obviousness"!!! The howls! Tried as they did, the patent office could find next to nothing - but they looked. Know what they found? They looked and eventually found a children's arts-and-crafts book describing how to make stuffed-bag pumpkins/decorations. It was then determined that her invention was "obvious", and therefore, the patent was denied. Going by that ruling, it's clear that many folks here would agree; especially since they've been pointing out even more obscure "prior art" when considering Apple's patents. Sure plastic leaf bags were available and sold for many years; except no one ever thought of repurposing it as a decorative object as well as a container for leaves meant to be discarded. Again, many things appear "obvious" in hindsight, and I believe many might be falling into the hindsight trap when looking at the things Apple is bringing to market. By the way, the pumpkin bag patent denial was overturned. She was granted a patent.

Look, can you point to any other company [other than Apple] currently embroiled in patent litigation that is having their [already] granted patents brought up for "reexamination" over "obviousness"? What about Microsoft? It seems to be a frequent and recurring tactic as of late, no?

It is a frequent tactic, yes. What of it? Billion dollar judgements get people's attention. Patents didn't use to fetch that kind of money; the biggest before that was around 400 million for the RIM thing and that might have even been reduced.

In any case, reexamination is a part of the system and has been for years.

Here's one where it appears that a bunch of patents related to golf balls were thrown out:

Apple has lost its attempt in imposing injunction on Samsung products in the Netherlands, as Dutch court rules against this motion, and determined that Samsung does not infinge on the community design(s) of Apple in the EU. This is similar in nature to the earlier UK decision that also denied any claimed infringement by Apple.

At issue was Apple’s registration of a rectangular tablet with rounded corners as a “Community Design,” a form of intellectual property right available in the European Union that allows businesses to prevent others from copying the outward appearance of their products. Apple has attempted to assert the design right to prevent sales of Samsung tablets before, with mixed results.

Apple’s Community Design of a rectangular tablet with rounded corners was at the center of a legal dispute with Samsung in a Dutch court.In his ruling on Wednesday, the president of the panel of three judges, Peter Blok, wrote: “The Galaxy Tab 7.7, 8.9 and 10.1 of Samsung are not covered by the scope of the community design.” This means that Samsung does not infringe on an Apple design right when it manufactures, supplies, markets, imports, exports or uses those products in the Netherlands and the E.U., according to the verdict.

The court cleared a number of Samsung subsidiaries, including Samsung Benelux and Samsung Europe Logistics, of infringement, and ordered Apple to pay Samsung’s costs of €127,357 (US$169,512). If Apple attempts to obstruct Galaxy Tab sales, it faces a fine of €100,000 per day, up to a ceiling of €10 million, the court ruled.

Fact: Pumpkin leaf bags were still allowed to get patented regardless of whatever "prior art" was trotted out.

Fact: Intermittent wipers also received a patent, and that it was upheld even though the entire weight of the auto industry's (who fought toothandnailforthingatthemouth!!!11) best legal teams pushed for it's invalidity, definitely speaks volumes.

Did it not appear obvious that the auto makers posed a much stronger argument w/r/t "obviousness", non-novelty, and "prior art" than what's being dredged up and held up against Apple's IP?

Can anyone here on the Battlefront argue those court decisions to uphold the patents?

Federal judge Lucy Koh left the jury's damages assessment largely unchanged, and denied motions for new trials. So both the findings, the monetary damages in the verdict, and the lack of injunctions, have been left untouched in the post-trial motions.

Since Koh found that Samsung's infringement wasn't willful, no additional damages will be assessed.

U.S. District Judge Lucy Koh in San Jose yesterday declined to increase the award after she found Samsung’s infringement wasn’t willful. The ruling was one of many post-trial decisions Koh issued yesterday denying both companies’ bids for a new trial and leaving largely untouched the jury’s finding in August that Samsung infringed six mobile-device patents.

“The court will not speculate as to how, precisely, the jury calculated its damages award,” Koh wrote in her ruling. It is “reasonable to assume” that the award is “intended to compensate Apple for losses stemming from all of the violations the jury found.”

Apple denied on appeal of sales bans based on utility patents on the Galaxy Nexus. This basically boils down to the argument that the Federal Circuit (which is the sole appellate court on subject matter related to customs and patents) had determined that: for a complex product requiring the use of a broad range of patent portfolio, it should not be excluded on basis of litigation of a narrow subset of patents.

Apple had asked the full Federal Circuit Court of Appeals in Washington, D.C., to revisit a decision in October by a three-judge panel of the same court. The panel rejected Apple's request to impose a sales ban on Samsung's Nexus smartphone ahead of a trial set for March 2014.

... ...

In its October ruling against Apple, the appeals court raised the bar for potentially market-crippling injunctions on product sales based on narrow patents for phone features. The legal precedent puts Samsung in a much stronger position by allowing its products to remain on store shelves while it fights a global patent battle against Apple over smartphone technology.

It still remains whether Apple will go to court over this, but since the entire other side of the business has settled with the DOJ and nullified Apple's MFN agreements, it stands to reason they too will settle as there's no advantage to fighting this without partners in the publishing industry.

Once they're accused to be taking part in an illegal conspiracy and presented with enough evidence to make them say "uncle". Apple didn't want a win/win/win. The consumer was at the short end of that stick, great for Apple and the cartel though.

Also recall that Amazon's MFN clauses and Apple's MFN clauses are not directly comparable. Also recall that Apple's MFN clauses were not illegal, but the collusion between them and the publishers was (allegedly), and that removing the MFN clauses was an easy remedy to the situation.

One set of MFNs has been found to be an illegal restraint of trade, where the other has not yet. So perhaps I misspoke - the MFNs themselves are not illegal, only the way in which they were used in the Apple, et al case were alleged to be. There is not yet any sign that the DOJ is going after Amazon for its use of MFN clauses, probably because there doesn't appear to be a conspiracy between the seller (Amazon) and suppliers. That's not to say there isn't, just that one hasn't been alleged, let alone any conspirators settling out of court.

BTW, who here actually believes that Apple would have a hard time competing with Amazon on the price for books

That one is easy to believe. Books are largely commoditized. Apple hates participating in such markets. Apple might strike out and find the few premium markets there are, but that's it.

It is institutionally averse to getting its fingernails dirty with price. Going after Amazon on its home ground is not a real winner for Apple. You can see it in its chosen strategy -- one designed to prop up prices.

That's not to say there isn't, just that one hasn't been alleged, let alone any conspirators settling out of court.

Moreover, the whole point of Apple's model was to prevent lower prices and that was in opposition to Amazon's model particularly.

If Amazon's model has these defects, they are well enough hidden that not only have the prosecutors not acted, Apple felt compelled to go after the market in a completely different way. And this from a company, as I have often observed (hell, its supporters often tell me) is not interested in strategies involving being the low cost producer.

If you want to see a "race to the bottom," books are in pretty full flower.

Once they're accused to be taking part in an illegal conspiracy and presented with enough evidence to make them say "uncle". Apple didn't want a win/win/win. The consumer was at the short end of that stick, great for Apple and the cartel though.

The language being used here is ludicrous. Again, Apple adopted an agency model that a) allowed publishers to set prices, and b) paid publishers a far larger share of revenue than Amazon was then paying. Publishers could have taken advantage of this to offer lower prices. Instead, they jacked prices up. How Apple is supposedly a consumer-hostile party here is beyond me. The only remotely anticompetitive step they took was imposing an MFN clause, which wouldn't have actually been problematic for consumers if publishers hadn't jacked up prices despite receiving a larger share of revenue.

The idea that Apple actively colluded with the intent of raising prices is incoherent. What is their motivation supposed to be? Apple doesn't see content as a major source of income, and in other cases is known to aggressively negotiate for lower content prices.

How Apple is supposedly a consumer-hostile party here is beyond me. The only remotely anticompetitive step they took was imposing an MFN clause, which wouldn't have actually been problematic for consumers if publishers hadn't jacked up prices despite receiving a larger share of revenue.

Because they were a willing party to the cartel's desire to jack up prices. Without all of the cartel members having an MFN agreement with a content portal (Apple in this case), they could not have fixed prices as they did. Apple's clout allowed them to have a credible partner and distribution channel, rather than the cartel putting up a sham portal that they had MFN arrangements with.

The idea that Apple actively colluded with the intent of raising prices is incoherent. What is their motivation supposed to be? Apple doesn't see content as a major source of income, and in other cases is known to aggressively negotiate for lower content prices.

Because they were a willing party to the cartel's desire to jack up prices. Without all of the cartel members having an MFN agreement with a content portal (Apple in this case), they could not have fixed prices as they did.

You keep using language that presupposes nefarious activity. The truth is, Apple entered the eBook market offering terms very similar to those it offers to app publishers — publishers set prices, Apple takes a fixed fee. Nobody seems to find that very objectionable with apps, so it's hard to buy that it's supposed to be objectionable with books.

The only significant difference in Apple's approach to selling eBooks was the MFN clause. But it's not clear that that this had any significant impact. Rather, the primary reason prices rose was simply that with another credible eBook distributor showing up, publishers gained additional leverage over Amazon — which they would have had a clear interest in using to negotiate more control over prices regardless of the existence of Apple's MFN clause. Essentially, prices rose because Apple's entry into the market broke an Amazon monopoly which had been suppressing eBook prices. The DoJ is going after Apple for anticompetitive behavior for breaking a monopoly. It borders on the surreal.

FunkTron wrote:

Saywhu?

Have you seen the revenues coming off the AppStore lately?

They're respectable in absolute terms, given the scale Apple now operates at, but they're not a huge source of income by Apple's standards. It seems fairly clear that Apple still views content primarily as an enticement for users to buy devices, which would motivate them to want lots of it available for cheap.

And Apple's eBook sales are fairly trivial compared with their app/music sales. Even if there were no other reason to doubt Apple's participation in some alleged collusion, it would be hard to buy simply on the basis that this market, by Apple's standards, isn't worth that much effort.

Horatio seems to like Amazon because Amazon lists things on the cheap. Amirite?

Look, it's nice to have lower prices - even for (e)Books, but has been argued by adminfoo (and others) - that comes with *significant* tradeoffs.

Apple was never in it for a money-grab on the content. Apple just wanted the content, and that's *it*. Apple can compete directly with the publishers if they wanted, but instead, they chose to deal with publishers. Now if Apple decides to employ the same model Amazon prefers to use, then I'm sure it will only decrease the number of laps left in the "race to the bottom".

But folks will have tons and tons of "cheap books", but that won't be saying much for quality. Eh, we'll see.

Unless you believe the CEO of MacMillan, and they settled for no good reason, there is ample evidence of nefarious activity.

Quote:

The truth is, Apple entered the eBook market offering terms very similar to those it offers to app publishers — publishers set prices, Apple takes a fixed fee.

Really? App publishers have to guarantee to sell their app on the apple app store for the lowest price anywhere, no matter the platform? I don't think that's true, but I haven't verified that.

Quote:

The only significant difference in Apple's approach to selling eBooks was the MFN clause. But it's not clear that that this had any significant impact. Rather, the primary reason prices rose was simply that with another credible eBook distributor showing up, publishers gained additional leverage over Amazon

this doesn't seem to be backed by evidence. The MFN clauses prevented any price differentiation across platforms, and the fact that all the publishers went to the same model at the same time accompanied with an increase in book prices was highly suspect. Amazon was effectively prevented from using the wholesale model by the clauses, and consumers were left paying more for eBooks.

Horatio seems to like Amazon because Amazon lists things on the cheap. Amirite?

Please do not ascribe to me positions that I have not explicitly stated.

He said you seem to, and I'd have to agree with his thoughts on that.

Apple has the legal right to offer the same terms to all parties, and the right to encourage them individually to move to similar terms with other parties. The only thing Apple can't do is encourage collaboration on pricing between publishers. It's only the collaboration on prices which is illegal.

As each publisher settled, the remaining defendants became responsible not only for their own treble damages, but also possibly for the treble damages of the settling publishers (minus what they settled for). A few weeks ago I got an estimate of the maximum possible damage figure. I cannot share the breathtaking amount with you, but it was much more than the entire equity of our company.

I like to believe that we would win at trial. But outcomes are hard to predict with certainty, particularly in a civil case with a low burden of proof. And so we agreed to settle with no admission of guilt

Unless you believe the CEO of MacMillan, and they settled for no good reason, there is ample evidence of nefarious activity.

Lawsuits are settled "for no good reason" all the time. Also, there are scenarios in which publishers could have colluded with each other without Apple's involvement — although I don't think that's necessary to explain events either, as explained below.

Horatio wrote:

Really? App publishers have to guarantee to sell their app on the apple app store for the lowest price anywhere, no matter the platform? I don't think that's true, but I haven't verified that.

I acknowledged the MFN clause was a distinction.

Horatio wrote:

this doesn't seem to be backed by evidence. The MFN clauses prevented any price differentiation across platforms, and the fact that all the publishers went to the same model at the same time accompanied with an increase in book prices was highly suspect. Amazon was effectively prevented from using the wholesale model by the clauses, and consumers were left paying more for eBooks.

None of that requires collusion to explain. At all. The agency model was better for publishers. It does not require collusion for multiple parties to all agree to a better deal. And if that deal becomes available to them all at the same time, guess what? They're all going to agree to it at pretty much the same time. Meanwhile, Amazon appears to have been prevented from continuing to use the wholesale model primarily by publishers refusing to continue to sell under Amazon's terms — which were, again, objectively quite bad for them — once they had other options.

Apple's MFN clause would only be relevant if you wanted to argue that absent that clause publishers would not have used the leverage they gained from the entry of a plausible competing distributor to pressure Amazon for better terms. But of course they had an interest in doing that regardless of the MFN clause.

Now, it is possible that publishers colluded with each other in their subsequent negotiations with Amazon (there would be no reason for Apple to involve itself there). However, individual book titles are, to a large extent, non-substituable. That is to say, Amazon did not have publishers in a position where if Publisher A refused to continue selling books, Amazon could simply make up the difference by purchasing more books from B, C and D. This gave publishers individual leverage over Amazon, removing any apparent need for collusion. And indeed publishers did not all boycott Amazon at once — Macmillan did so alone, and that was sufficient for Amazon to cave. Absent specific evidence of collusion, I see no reason not to accept this at face value, since nothing about it appears to require further explanation.

Because they were a willing party to the cartel's desire to jack up prices. Without all of the cartel members having an MFN agreement with a content portal (Apple in this case), they could not have fixed prices as they did. Apple's clout allowed them to have a credible partner and distribution channel, rather than the cartel putting up a sham portal that they had MFN arrangements with.

This is B.S. the publishers are not a cartel and the last time I checked there was nothing wrong with using a new player in a given market to get a better price for your product. Especially when that new player is breaking a monopoly. The problem here is that Amazon blinked, the iBooks store turned out not to be a meaningful competitor, but by the time they found that out they gave away the farm. But America is no longer a country were big companies have to live with their bad choices. So Amazon ran to the DOJ to get them out of the hole they jumped into. If Amazon held out it would have become clear with in 30 days (90 at the latest) that Apple wasn't going to move as many books as Amazon. At that point the publishers would have caved and allowed Amazon to buy and sell books any way it wants. Apple wouldn't have cared because the MFN clause would have let them sell books at the same price as Amazon.

This case is ludicrous because nothing about the MFN guarantees a higher price. Amazon blinked and that's not the governments problem.

Apple's MFN clause would only be relevant if you wanted to argue that absent that clause publishers would not have used the leverage they gained from the entry of a plausible competing distributor to pressure Amazon for better terms. But of course they had an interest in doing that regardless of the MFN clause.

Apple's MFN was relevant because it allowed publishers to specify the lowest price to consumers. No matter what Amazon did, they could not charge less than Apple.